Chipotle Is Struggling To Bounce Back After Foodborne Illness Outbreaks

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By Cooking Panda

After experiencing numerous foodborne illness outbreaks, followed by an attempt to win back customers by giving away several million burritos, Chipotle Mexican Grill has not-so-surprisingly achieved its first-ever quarterly loss.

In the three months ending on March 31, Chipotle lost $26.4 million on a 23.4 percent decrease in revenue, and same-store sales dropped 29.7 percent. Investors are abandoning the chain as well, which pushed Chipotle shares down 4.8 percent.

According to The New York Post, the chain has had a shaky recovery from the e-coli and norovirus outbreaks experienced in numerous restaurants in 2015. As a result, a variety of customers, including its most regular patrons, are deciding to eat elsewhere.

“A lot of what we are aiming our efforts at are our top, loyal customers,” said Mark Crumpacker, chief development and creative officer. “Their frequency has declined.”

The amount of typical customers who have not visited Chipotle in three months has increased from 49 to 57 percent, according to Crumpacker.

By introducing new menu items and frequency reward programs, Chipotle is hopeful about its future and aims to convince both Wall Street analysts and customers that the chain has much to offer.

“Sales are so volatile, but I would not expect a loss in the second quarter,” said Chief Financial Officer John Hartung.

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Source: New York Post / Photo credit: tacvbo/Flickr via Wikimedia Commons

Tags: Chipotle Mexican Grill, e-coli, foodborne illness outbreak, norovirus, quarter loss
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